at some point the hour glass disappears,
Aha. I never waited long enough.
I just tested and after a minute or so the pointer returns to normal and then behaves. Weird. Is the bug with Xfce or XFE? I don't know. Doesn't happen in KDE. Well, your observation led me to try something else.
I started XFE from a command line. No busy pointer. I then started XFE from the Run dialog box (Alt-F2). No busy pointer. I then ran XFE from my task bar panel applet icon, which is where I always start XFE. Busy pointer.
I opened the Properties box for the panel icon and on a whim, disabled Use startup notification
. No more busy pointer!
I repeated the process of enabling and disabling startup notification. Same results.
Problem solved, but I wonder why this happens.